25 posts from April 2012

April 30, 2012

The Massachusetts State House, for the third year in a row, voted to repeal the controversial Massachusetts Pharmaceutical and Medical Device Manufacturer Code of Conduct(PCOC). As reported by Pharmalot, the latest effort goes beyond the previous two tries: “the House also agreed to repeal a disclosure rule that requires all financial arrangements between drug and device makers with prescribers is posted on a website maintained by the state Department of Public Health.”

Dr. Charles Birbara, a Worcester rheumatologist, is in favor of lifting the ban, because it is better for his patients and gives them more options." Dr. Birbara told GoLocalWorcester, "The insurance company often times controls what we prescribe by virtue of what's on their formula. There are many people that don’t take prescribed medicine, because they can’t afford it. These co-pays can get very pricey. The coupons really help out the patient."

According to MA Rep. Jason Lewis, who is working to stop the amendment from passing, those on the other side of the issue have their reasons. “We want to make sure they have the best interest of patients. There are opponents who say that that argument is well and good, but it’s hurting the pharmaceutical industry in Massachusetts,” he said.

Speaker of the Massachusetts State House, Robert A. DeLeo is also opposed to the ban.

Background

In 2010, Massachusetts Governor Deval Patrick made a point during his reelection campaign that the PCOC “was never intended to extend to the state's medical device industry,” and “goes beyond” the code that the pharmaceutical industry uses to police itself,” “and thus should be narrowed.”

“I think that was not its intent,” he said during an October 2010 forum in front of an audience of biotech advocates. “Aligning it with Pharma is a priority of mine.”

Patrick added that the PCOC was “ripe for repeal or modification, since the Obama administration's federal health care overhaul included superseding language.” As a result, a spokesman from the Department of Public Health, which oversees these regulations, said the agency was currently reviewing the ways in which Massachusetts regulations are impacted by federal law in order to determine whether there are any additional steps that need to be take.

Additionally, the Massachusetts State Assembly voted overwhelmingly 128-22 to repeal the PCOC in late April, 2011 during its annual budget debate, but the proposal was dropped during negotiations with the Senate.

Despite strong signals that Gov. Deval Patrick, the House and the Senate would support peeling back parts of a three-year-old ban on gifts from pharmaceutical companies to doctors – a policy that critics say is strangling the restaurant business and killing jobs – 2011 came to a close without action.

However, the article noted that “efforts to dismantle components of the ban are poised to reemerge in 2012 and received the fresh backing of a panel of lawmakers” at the end of December, potentially teeing up the issue for consideration during debate on a major health care system overhaul eyed for next year.

Specifically, a move by the Committee on Public Health to give a favorable recommendation to the proposal came at a time when most lawmakers had cleared out of the capitol for an extended holiday recess. The pre-Christmas activity angered consumer advocates who argue that any attempt to weaken the so-called gift ban would encourage doctors to prescribe costlier medications, drive up health care costs, and infringe upon safeguards intended to ensure that patient interests prevail over business relationships.

Most recently, House leaders have been calling for a repeal of the gift ban according to a recent article from the Boston Herald, mostly because lawmakers believe that the federal law—Physician Payment Sunshine Act—will preempt majority of Massachusetts law. Until CMS proposes the final regulations and the Supreme Court decides whether the entire Affordable Care Act stays or goes, it is unlikely that Massachusetts will repeal the gift ban. The proposed House bill would keep the state reporting requirements, some of which exceed those required under the Sunshine Act.

Enacted in 2009, the PCOC or “gift ban” has been a controversial piece of legislation that has had significant impacts on the pharmaceutical and medical device industry in Massachusetts. The ban prohibits pharmaceutical companies and medical device manufacturers from providing “entertainment or recreational items of any value,” such as sports tickets; cash payments; “complimentary items” such as pens, mugs or gift cards; grants and scholarships in exchange for a promise to prescribe certain drugs or use certain devices; or any other prohibited “kickback.”

In addition, drug and device companies may only provide meals to doctors inside the hospitals or offices where they work, a fact that proponents say prevents lavish spending on expensive dinners and alcohol as a means to peddle influence. The policy also requires drug and medical device companies to annually disclose “any fee, payment, subsidy or other economic benefit with a value of at least $50” provided to doctors, hospitals, nursing home workers, insurers or other “health care practitioners.”

The legislation also requires manufacturers to adopt a set marketing code of conduct to help ensure that health care providers were making choices about prescription drugs for their patients based on therapeutic benefits and cost-effectiveness. This code had a number of provisions governing the types and nature of interactions industry could have with physicians. The Code of was subsequently adopted by the Massachusetts Department of Public Health (DPH).

Discussion

Those who support repealing the PCOC maintain that the regulation has severely affected medical innovation and collaboration, and thus decreased the quality of training and education health professionals receive, also decreasing the quality of patient care. In fact, a study done by MIT showed that the Code of Conduct is having significantly negative effects on patient care and medical innovation. And one article noted how the gift ban is having a negative effect on primary care physicians in Massachusetts because it is cutting off opportunities for clinicians to gather new scientific information and exchange real-world clinical information. Additionally, the gift ban has resulted in companies withdrawing funding for fellowships, professorships, and other faculty positions and departments in Massachusetts.

Moreover, medical device companies noted the significant burden the legislation placed on them considering the fact that many physicians needed to work directly with industry to learn how to use certain medical devices.

As noted by the Boston Herald, The bill backed by the Public Health Committee (H 1507) would eliminate the disclosure requirement. The proposal also repeals a prohibition on pharmaceutical companies providing meals to doctors outside of a “hospital setting,” so long as the meals are part of an event that is “primarily educational in nature.”

Backers of eliminating restrictions on meals say they have harmed the restaurant and convention industries, particularly in Boston, which has a high concentration of hospitals and pharmaceutical companies that surround the North End, a popular restaurant district. For example, pharmaceutical and device companies have been “curtailing sales, marketing and training activities in Massachusetts” in order to comply with the new rules, and “some outside companies are avoiding Massachusetts altogether.”

State Rep. John Mahoney told GoLocalWorcester the restaurant ban is hurting business in the Bay State. "We are the only state that doesn’t allow doctors to have dinner with pharma companies. I don’t think doctors are being swayed by a free meal. People who own restaurants are getting hurt by this. Companies are going to other states to work around this law. They are holding events and dinners in neighboring states."

In fact, an article in the Boston Globe noted how the new laws have resulted in “fewer jobs related to training, medical device sales and clinical trials.” They also argue that doctors would not be improperly influenced by a meal and could gain valuable insight into advancements in medical devices or cutting-edge drugs.

“I think we should be looking at ways of modifying this. It’s, in my opinion, way too restrictive. I think it’s negatively impacting our convention industry,” said Rep. Vincent Pedone (D-Worcester), lead sponsor of the legislation. “This is what some of the proponents of modest change wanted to see. I’m trying to find a compromise between repealing the whole gift ban and making it more workable.”

Pedone said he’s supportive of the pharmaceutical industry’s own code of conduct. “The pharmaceutical industry has come a long way in a short time with this. If we can adopt just what their code is, which I think is the standard across the country for states, we would be in much better shape,” he said.

Efforts to relax the gift ban have gained popularity in the House, which has passed complete repeals for two straight sessions. But they’ve stalled in the Senate, where Senate President Therese Murray led the drive to implement the gift ban in 2008 legislation. Last year, however, senators nearly deadlocked on a plan to permit pharmaceutical and medical device companies to buy dinners for doctors, voting 19-18 to preserve the ban.

The Boston Herald noted that, “it is unclear how eight freshmen in the Senate will affect the outcome, although four of five new senators who served in the House voted to repeal the gift ban law as state representatives.”

Sen. Susan Fargo (D-Lincoln), co-chair of the committee, said she is opposed to efforts to weaken the gift ban, describing even an incremental change as “the nose of the camel getting under the tent.” Fargo said she hopes the proposal is “fully debated” on the floors of the House and Senate. “At the time that the gift ban was passed – and the Senate strongly endorsed it – pharmaceutical companies were spending far more on marketing and advertising than they were on research and development,” she said.

Asked about the House’s repeated votes to repeal the gift ban altogether, Fargo said, “Sometimes the House and the Senate simply have philosophical differences about legislation.” She added that she has no reason to believe the Senate has changed its attitude about the ban. Fargo also said she hoped efforts to whittle down the ban are debated apart from omnibus health care reform legislation planned for next year.

“The core issue of payment reform is big enough and important enough that it should stand alone,” she said.

Deirdre Cummings, legislative director of the consumer group MassPIRG, said she hopes the House waits until its members return from a seven-week recess before considering efforts to weaken the gift ban. “The concern from the consumer end is that the pharmaceutical industry are setting up these meetings and they’re really only marketing the most expensive, brand name prescription drugs,” said Cummings. “The impact of that marketing is also significant. It leads to higher prescribing. That’s the concern from the consumer end.”

Restaurant industry officials, however, say amending the gift ban to permit educational meals at local restaurants would provide an immediate economic jolt to the hospitality industry and lure drug conventions to Massachusetts. Dave Andelman, CEO of Phantom Gourmet, said the ban failed to prevent deep-pocketed drug companies from flooding consumers with advertisements but has created an impediment for smaller companies hoping to break into the market.

“Pfizer can wrap the whole T in advertising but these generic companies can’t take a doctor to dinner. It’s silly. It should be changed, and it should be changed now,” he said. “I have every reason to believe that it can change. We’ve been approaching every senator and making our case, and without naming names, even some senators that I thought really wouldn’t give us the time of day had to admit that all the arguments I’m making to you now make a lot of sense.”

Conclusion

As one recent article from the Boston Business Journal noted, it is “insulting to our physicians, some of the best minds in the country, to think they can be bought for a mug or a yogurt.” The author correctly recognized that “Much of the money flowing to our health care institutions [from industry] goes toward things like fellowships in the orthopedics department at Massachusetts General Hospital or a diabetes clinical trial at Beth Israel Deaconess Medical Center. It also goes towards training for heart surgeons on the newest stent procedures and to safety studies on rare disease drugs developed by Genzyme Corp.

Ultimately, with more and more companies picking up and leaving Massachusetts, and new businesses and other industries deciding to set up their offices in other states, it is becoming clearer to some that the Code of Conduct must go. With 8 new Senators in the Massachussetts Senators, this may provide the needed difference to repeal the PCOC, especially given that the Sunshine Act regulations are now out, making the reporting requirements under the code unnecessary and duplicative. Accordingly, Governor Patrick would be doing a service to the patients, health care practitioners, and entrepreneurs of Massachusetts by urging his legislature to repeal the Code of Conduct.

It is unlikely that Massachusetts will repeal this law until the U.S. Supreme Court decides whether the Affordable Care Act is constitutional, and whether the Sunshine Act will stand or be stricken. But the effort to repeal the current law in Massachusetts is sincere and it is important for states to note, that despite the “claims” of cost savings there is no evidence of that for the bay state, thus the repeal effort.

Over the past few years, health care reform has consistently made news headlines. The significant costs and problems generated by the U.S. health care system, coupled with the landmark passage of the Patient Protection and Affordable Care Act (ACA), has kept journalists, bureaucrats, health officials and politicians busy.

A sizeable portion of the attention surrounding the health care system and health care reform has involved the role of the healthcare industry: insurance companies, pharmaceutical and medical device manufacturers, managed care organizations, etc. While much of the press coverage has focused on the problems that these stakeholders have allegedly created or failed to address, there has been little attention regarding the positive health outcomes and benefits our country has seen over the past few decades.

Consequently, a recent article that looked at statistics “stretching from 1935 to 2010 found significant improvements in Americans' expected lifespans, mainly due to factors such as better medical care and declines in smoking rates.” Specifically, the average American's overall risk of dying at a given point in time dropped 60 percent since 1935, the study found. This increased American lifespan is directly attributable to the advances of medical device and pharmaceutical manufacturers who have pushed the envelope and invested billions of dollars to improve the quality and health of us all.

A combination of lifestyle changes and medical advances fueled the dramatic drop in death rates, according to the U.S. Centers for Disease Control and Prevention (CDC) report published in the March NCHS Data Brief. Highlights of the report include:

In each year, heart disease, cancer and stroke were among the five leading causes of death.

The risk of dying dropped in all age groups but was strongest among children aged 1 to 4 years, where the rate dropped 94 percent.

For those aged 85 and older, the risk of dying dropped 38 percent.

Death rates were higher among men, although they decreased for both genders during the 75-year study period. From 1975 to 1981, the risk of dying was 65 percent higher for men than women, while it was only 40 percent higher for men than women in 2010.

The decline in deaths was seen in all racial and ethnic groups. However, there are still disparities, with the biggest gap found between 1988 and 1996, when one white person died for every four blacks.

"Overall, the improvement in mortality has been significant over the last 75 years," said report author Donna Hoyert, a health scientist at CDC's National Center for Health Statistics. To compile the statistics for the report, Hoyert used data from the National Vital Statistics System for the 75 years covered, including preliminary data for 2010.

The reasons for this trend are varied, Hoyert said. “The way we live now is much different than in the [1930s]. In the medical field, there have been advances and changes in behavior over time,” she said. Among the most significant changes have been the decrease in smoking rates and more aggressive treatment of heart disease, she noted.

In addition, the introduction of antibiotics in the 1940s made a huge impact. "There were some easily treatable potentially fatal diseases, such as pneumonia, that all of a sudden we got antibiotics for," said Dr. Laurence Gardner, executive dean for education and policy at the University of Miami Miller School of Medicine.

A more aggressive approach to treating cardiovascular disease also evolved in the past 20 years, Gardner said. “Even more important, the use of cholesterol-lowering drugs [statins] in such a large proportion of the population has contributed to decreased death rates,” he said.

The advances in treatment were really only seen in one area -- cardiovascular disease, Gardner said. “The folks in the cancer world are still pulling their hair out, because while there may be increases in survival, the cure rates have not improved very much despite the enormous efforts,” he said, although he added that he believes there will be advances in cancer treatment in the future that will help lower mortality rates.

Despite the positive benefits in cardiovascular disease, Garndner pointed to the obesity epidemic, which is fueling a diabetes epidemic. “If we don't effectively address the obesity/diabetes issue, we may lose some of the benefit we have gained,” he stressed. “We haven't seen the effect of the epidemic of obesity and diabetes reflected in the death rate [yet].”

Another issue is the growing cost of expensive medical interventions. The United States spends more on health care than any other nation, and there is a point of diminishing returns where the costs outweigh the benefits, Gardner said. He noted how the U.S. does not “manage the end-of-life care very well and we do spend unnecessary funds and cause some unnecessary hardship.”

Discussion

While the statistics of this report offer hopeful insight into medical progress in America, there are some troubling trends that may create obstacles and hurdles for continued success in cardiovascular disease and other chronic illnesses such as cancer. In particular, the current regulatory environment at the Food and Drug Administration (FDA) as well as the push for transparency (i.e. Physician Payment Sunshine Act) in the Obama Administration has the potential to cause a chilling effect on innovation and scientific progress in America.

Transparency and accountability are certainly important goals, which we agree with. However, the cost of increased regulations and economic burdens, as well as a misinformed public can stigmatize an already difficult and uncertain regulatory and research environment in the life sciences.

Although we have seen advances in the last 75 years, the regulatory landscape has changed dramatically, as has science, medicine, and humans in general. In order to continue the success we have seen in the past, the government, academia, and industry must continue working together, in a way that encourages collaboration, instead of attacking it.

One example of the kind of collaboration that will lead to further scientific and medical advances is a new partnership announced between the National Institutes of Health (NIH) and Eli Lilly. The partnership, announced earlier this month, “will generate a publicly available resource to profile the effects of thousands of approved and investigational medicines in a variety of sophisticated disease-relevant testing systems, NIH announced today.”

NIH recognized that, “Comprehensive knowledge of the biological profiles of these medicines and molecules may enable biomedical researchers to better predict treatment outcomes, improve drug development, and lead to more specific and effective approaches.”

Through the collaboration, the NIH's newly established National Center for Advancing Translational Sciences (NCATS) and Lilly Research Laboratories have agreed that NCATS’ Pharmaceutical Collection of 3,800 approved and investigational medicines will be screened using Lilly’s state-of-the-art Phenotypic Drug Discovery (PD2) panel. This panel features assays (i.e. tests) that are designed to reveal novel mechanisms or pathways of potential medicines and, as part of this collaboration, approved medicines as well. As such, the panel may provide new insights for drug discovery.

“This innovative collaboration with Lilly is exactly the type of partnership that NCATS is eager to foster with many other groups from industry, government and academia,” said NCATS Acting Director Thomas R. Insel, M.D. “Working together, we can make drug development pipelines more productive. The key is precompetitive collaboration to benefit all partners, ensuring broad access to the results.”

The NCATS Pharmaceutical Collection (NPC) is a comprehensive publicly available database (http://tripod.nih.gov/npc) and is a physical sample collection. The PD2 assay panel, part of Lilly's Open Innovation Drug Discovery platform, consists of sophisticated human disease pathway-related assays relevant to cardiovascular diseases, cancer and endocrine disorders, among others. These testing systems are designed to reveal novel mechanisms or pathway activities of drugs.

“This profiling, broad in terms of the therapeutics tested and the range and complexity of the biological readouts, will leverage the NPC in just the way I envisioned when we assembled the pharmaceutical collection,” said Christopher P. Austin, M.D., director of the NCATS Division of Preclinical Innovation. “The combination of the power of the PD2 component of Lilly's Open Innovation Drug Discovery platform and the NPC will benefit of the entire scientific community.”

The screening will take place over the next 12 to 18 months, and results will be made freely available at http://tripod.nih.gov/npc/. For example, if an approved medicine is found to be a possible treatment candidate for a new disease indication, a partnership with the organization that owns the chemical compound could be formed to pursue additional studies. These might include clinical trials required for marketing approval by FDA. Alternatively, medicines with activity in the PD2 assays might serve as starting points for additional chemistry research efforts to produce new medicines.

“This initiative is a great example of how we can collectively leverage unique capabilities from the public and private sectors toward our shared goal of advancing science and improving patients' lives,” said Alan D. Palkowitz, Ph.D., vice president of discovery chemistry research and technologies at Lilly. “It also attests to the importance of collaborative research because, despite major advances in biomedical science, much work remains to be done.”

Conclusion

NIH and Lilly’s partnership should be applauded and encouraged to ensure that Americans continue to have the best health care treatments available. Moreover, NIH, life science companies, and other research institutions should pursue similar partnerships and arrangements. With continued collaboration such as this, Americans may live to see a cure for cancer.

April 27, 2012

The Department of Health & Human Services (HHS) officially proposed delaying the ICD-10 deadline by an extra year to Oct. 1, 2014 this past week. ICD-10 is an update and expansion of diagnosis and procedure codes that are widely used in medical billing, as well as for research and other purposes.

The ICD-10 compliance date change is part of a proposed rule that would adopt a standard for a unique health plan identifier (HPID), adopt a data element that would serve as an “other entity” identifier (OEID), and add a National Provider Identifier (NPI) requirement. The 10th iteration of the disease-classification system will expand the number of codes in use from around 18,000 in the current ICD-9 code set to about 140,000.

HHS also released a proposed rule establishing a unique health plan identifier with a standard length and format under the Health Insurance Portability and Accountability Act (HIPAA) that would make it easier for doctors, hospitals and health insurance companies to identify patients and issue payments for treatment. By standardizing the length and format of the health plan identifier, healthcare provider offices will be able to automate and simplify their processes, particularly when managing bills and other transactions.

Currently, health plans and third-party administrators, such as bill providers, are identified using a wide range of different identifiers that do not have a standard length or format. The variety of formats causes a time-consuming problems, such as misrouting of transactions or even the rejection of bills by payers due to ID errors. With the new identifier, insurers could avoid multiple identification codes they currently use to identify themselves, including taxpayer identification numbers, employer identification numbers and proprietary codes, reported LifeHealthPro.

“The new health care law is cutting red tape, making our health care system more efficient and saving money,” Sebelius said. “These important simplifications will mean doctors can spend less time filling out forms and more time seeing patients.”

The proposed rule was developed by the Office of E-Health Standards and Services (OESS) as part of its ongoing role, delegated by HHS, to establish adopt standards for electronic health care transactions under the Health Insurance Portability and Accountability Act of 1996 (HIPAA). OESS is part of the Centers for Medicare & Medicaid Services (CMS). Public comments are due in thirty days, and should include the docket reference CMS-0040-P.

The delay is “an attempt to give people some ability to reprioritize,” because providers and insurers also must comply with multiple reform law requirements such as implementation of electronic health records, Kaveh Safavi, an Accenture managing director, told The Wall Street Journal Health Blog.

HHS Secretary Kathleen Sebelius said the identifier rule would cut "red tape" and save the industry $4.6 billion over the next 10 years.

Background

On January 16, 2009, HHS published a final rule to adopt ICD-10 as the HIPAA standard code sets to replace the previously adopted ICD–9–codes for diagnosis and procedure codes (see HIPAA Administrative Simplification; Modifications to Medical Data Code Set Standards to Adopt ICD-10-CM and ICD-10-PCS, 74 FR 3328). The compliance date set by the final rule was October 1, 2013.

Implementation of ICD-10 will accommodate new procedures and diagnoses unaccounted for in the ICD-9 code set and allow for greater specificity of diagnosis-related groups and preventive services. This transition will lead to improved accuracy in reimbursement for medical services, fraud detection, and historical claims and diagnoses analysis for the health care system. Many researchers have published articles on the far-reaching positive effects of ICD-10 on quality issues, including use of specific reasons for patient non-compliance and detailed procedure information by degree of difficulty, among other benefits.

Some provider groups have expressed serious concerns about their ability to meet the October 1, 2013 compliance date. Their concerns about the ICD-10 compliance date are based, in part, on implementation issues they have experienced meeting HHS’ compliance deadline for the Associated Standard Committee's (ASC) X12 Version 5010 standards (Version 5010) for electronic health care transactions. Compliance with Version 5010 is necessary prior to implementation of ICD-10.

All covered entities must transition to ICD-10 at the same time to ensure a smooth transition to the updated medical data code sets. Failure of any one industry segment to achieve compliance with ICD-10 would negatively impact all other industry segments and result in rejected claims and provider payment delays. HHS believes the change in the compliance date for ICD-10, as proposed in this rule, would give providers and other covered entities more time to prepare and fully test their systems to ensure a smooth and coordinated transition among all industry segments.

In addition to this announcement, CMS last month extended the March 30, 2012 deadline for eligible professionals (EPs) to file their "eligibility" appeals under the electronic health record (EHR) incentive program. The deadline is now April 30, 2012.

“An eligibility appeal allows a provider to show that all the requirements for the Medicare EHR Incentive Program were met and that he or she should have received a payment but could not because of circumstances outside of the provider's control," CMS said in its April 3 announcement. CMS didn't divulge why it opted to extend this deadline.

The deadline extension only applies to eligibility appeals. It does not affect "Meaningful Use" and "incentive payment" appeals, for which the deadlines differ based upon when the provider receives notice regarding a payment or attestation issue from CMS.

CMS has selected Provider Resources, Inc. of Eire, Pa., to hear administrative appeals, with support to be provided by CMS' Office of Clinical Standards and Quality (OCSQ). Opinions of appeals will be posted on OCSQ's website.

CMS affords providers with a two-level appeal process: an informal review and a request for reconsideration. Within the two-level appeal process, there are three types of appeals that can be filed in the Medicare EHR Incentive Program: (1) eligibility, (2) meaningful use, and (3) incentive payment appeals.

Detailed guidance on the appeals process and additional information on all of the appeal types are available on the OCSQ website.

Conclusion

This is perhaps the first of several delay’s we will see in implantation. According to one expert on electronic medical records and health systems, there could be at least two to three one year delays before ICD-10 is finally implemented. ICD-11 is expected to be released sometime in the next couple of years, so this could easily morph before we adopt a new coding system.